Rex in voluntary administration, ending all 737 services

[Saab34]

That aircraft doesn’t come cheap either. That’s a large outlay for what is marginally thin routes.

I think the government is stuck with this for a long time.

 

[kamchatsky]

To me regional flights are essential services, so it is a no brainer to buy the aircraft when the government owns Rex. No party will oppose it. It is what it is.

 

[eastwest101]

To me regional flights are essential services, so it is a no brainer to buy the aircraft when the government owns Rex. No party will oppose it. It is what it is.

Until a suitable replacement aircraft comes along for the Saab 340 (or the price of used Dash 8s/ATR42s or something else comes down to get over the capital hurdle) that might be the way it plays out as a realpolitik thing.

To be fair Rex had a Covid/VA being bailed out/epically stupid management and a failure to market its B737 jet operations more than anything. As Link has shown - its possible to operate the Saab 340 profitably in Australia, and nothing I have seen from the front-line staff in Rex would give anyone a reason to think that there is some inherent flaw in the cost structure/staff/operational capacity of the airline to be viable if released from the debts/sins of its past.

Just as Alliance proved that its possible to profitably fly E190s in Australia (despite Virgin's failure to do so) it's not often the equipment that sets businesses up for failure, but more likely stupid financial and market decisions by senior management that allow airlines to go to the wall. Similarly, Bonza went broke flying B737s and no one is saying that the B737 is an intrinsically unprofitable aircraft. Ditto for the A320 with Tiger.

 

[kamchatsky]

Until a suitable replacement aircraft comes along for the Saab 340 (or the price of used Dash 8s/ATR42s or something else comes down to get over the capital hurdle) that might be the way it plays out as a realpolitik thing.

To be fair Rex had a Covid/VA being bailed out/epically stupid management and a failure to market its B737 jet operations more than anything. As Link has shown - its possible to operate the Saab 340 profitably in Australia, and nothing I have seen from the front-line staff in Rex would give anyone a reason to think that there is some inherent flaw in the cost structure/staff/operational capacity of the airline to be viable if released from the debts/sins of its past.

Just as Alliance proved that its possible to profitably fly E190s in Australia (despite Virgin's failure to do so) it's not often the equipment that sets businesses up for failure, but more likely stupid financial and market decisions by senior management that allow airlines to go to the wall. Similarly, Bonza went broke flying B737s and no one is saying that the B737 is an intrinsically unprofitable aircraft. Ditto for the A320 with Tiger.

I really don't know what is the suitable replacement aircraft for the Saabs, that would be the government to work out (assuming they will own Rex) as they have responsibility to provide essential services to the regional towns.

I don't know how long those Saabs can be continuingly serviced to provide safe services for the regions. Sooner or later, they will run out of Saab spare parts.

Given it takes ages to tender and procure and deliver aircrafts, it is best to start that process sooner rather than later.

 

[DC3]

Is there any AFFer who doesn’t know how to run an airline?

 

[markis10]

There is a large number of ATR72s (50-60) coming off lease this year and next, could be an ideal aircraft for REX work given its economics on the sub 1000km sectors. Bigger than a SAAB obviously but the lack of a new sub 50 seat aircraft for years has put pressure on operators. It seems to have worked for Loganair who had a large SF340 fleet.